02.03.04

The first stage involves the transition to International Accounting Standards (IAS) by banks, professional participants in the securities market, and publicly traded companies. Other organizations at the this stage will continue to report as before (according to Russian Accounting Standards).

National standards for financial reporting and accounting rules will be developed by the Ministry of Finance and approved by the Russian government. However, before these reaching the government approval stage, drafts of all statutory acts must pass through examination by a certain "non-governmental institution," which then acts as co-author of the project. This institution is the fund "National Organization On Questions Of Financial Accounting and Reporting."

In the second stage government structures and insurance companies will be required to move to IAS. Organizations with the designation of "socially significant" (issuers of securities and organizations with commercial activity in which the government has invested) will continue to report accorging to Russian standards. All other organizations in general will be exempt from obligatory financial reporting. In this second stage there will also be a redistribution of powers amongst the various regulating agencies. Standards for financial reporting will be developed by a non-government institutions.

The third stage assumes the transition of all (without exception) "socially significant" organizations to IAS. Additionally, the non-government institution will be authorized to "approve" national reporting standards.

Two to three years are allocated to the realization of each stage of the project. According to the authors's plan, the corresponding amendments to the legislation should be entered by the government by 10.06.04 and come into force 1.01.05.

Though scheduled for April, the coordination of the project in the Ministry of Finance most likely will not pass quickly and smoothly. Alexander Bakayev, Head of the Department of Methodology of Accounting and Reporting of the Ministry of Finance in an interview with "UNP," has made his rather ironic estimation of the project: "Accounting, balance sheets - this is global practice! Well, let's progress ahead of everyone on the planet! "